اصلاحات بخش بانکی و اهرم شرکت ها در بازارهای نوظهور

Using a large panel of non-financial firms in emerging markets, we study the relation between detailed measures of banking sector reforms and corporate leverage. We find that banking sector reforms are associated with lower corporate debt in emerging market firms, consistent with the notion that these reforms improve banks' risk management and result in tighter lending standards, leading firms to use less bank debt in their capital structure. These effects are less pronounced for financially constrained firms, suggesting a relative increase in the supply of bank credit to firms which were rationed prior to the banking sector reforms.

In the past two decades, the banking sector has undergone large transformations in many countries around the world. These reforms include banking sector supervision and regulation, bank entry, bank privatization and deregulation of interest rates. The goal of these policies was to reduce government intervention and broaden the scope for market forces to operate in capital markets. Financial deregulation policies were first advocated by McKinnon and Shaw in the 1970s (McKinnon, 1973 and Shaw, 1973) especially for emerging markets, where state intervention in the financial sector was especially heavy handed. As reforms began to be implemented in the late 1980s and early 1990s, however, evidence emerged that in some circumstances they could lead to undesirable outcomes, such as high and volatile interest rates and macroeconomic and financial sector instability. These drawbacks were attributed to various factors, such as a mismanaged or premature reform process, inadequate bank prudential regulation and supervision, or weak institutions to protect property and contractual rights.2 Differing from the large portion of the literature that has focused on the impact of financial reforms on either aggregate credit or financial stability, in this paper we assess how banking reforms affect firms' choices of debt in their capital structure by reducing government intervention and in allowing market forces to operate.3 We concentrate on corporate debt in emerging markets since firms in these markets depend heavily on bank debt due to limited development of public debt markets. Therefore, domestic banking sector reforms should have a significant impact on the corporate leverage decisions in these markets. Using a detailed measure of banking sector reforms and a large panel of non-financial firms in 17 emerging markets during the period 1990–2002, we find that firms carry less (bank) debt in their capital structure following banking sector reforms. The evidence is consistent with the notion that these reforms foster efficient credit market development, which results in higher costs of bank funding, better pricing of risk, tightened lending standards and more stringent bank supervision. Research by Schmukler and Vesperoni (2006) is closely related to ours in terms of focusing on debt in emerging markets. They study the impact of a number of financial reforms on debt maturity in seven emerging markets during the period 1980–1998. They consider three types of reforms: the first is the liberalization of foreign entry into the local stock market (Bekaert et al., 2005); the second is a proxy measure of liberalization of the domestic financial sector (Beck et al., 2000); and the third is the liberalization of controls on foreign capital flows (Kaminsky and Schmukler, 2003). They find that both stock market liberalization and domestic financial liberalization do not have a significant impact on the debt maturity of firms that actively access global markets, but they lead to shorter debt maturity in firms that do not access global markets. They also find that foreign capital flow liberalization has no significant effect. The paper concludes that the effects of financial liberalization are asymmetric in emerging markets, since firms that are not able to integrate in world capital markets appear unable to obtain long-maturity debt. Our study complements their findings by focusing on banking sector reforms and how they affect capital structure decisions. We examine the relation between credit market reforms and corporate leverage by using a multidimensional measure of the reform process constructed by Abiad et al. (2010). Banking reforms are measured with an index, whose components track actual policy changes in several important dimensions of the regulatory environment: Bank supervision, bank competition, credit allocation, bank privatization and interest rates. We consider these reforms both separately and together as a banking sector reform index. We carry out our analysis for a large set of emerging markets by controlling for global trends and for changes in the macroeconomic environment. The relation of these reforms with corporate leverage is gauged by a rich regression specification of the determinants of firm leverage. A standard measure of leverage is specified to depend on a set of firm-level characteristics dictated by corporate finance theory, country-level control variables, and firm and time fixed effects. Corporate leverage and the firm level determinants of leverage are based on the pecking order and trade-off theories of capital structure (see Myers, 1984 and Myers and Majluf, 1984). According to pecking order theory, due to information asymmetries in the market, firms choose to finance their projects first by internal funds, then by corporate debt and then finally with equity. According to trade-off theory, firms balance tax savings from debt against deadweight bankruptcy costs. According to these theories and the following empirical studies (see Frank and Goyal, 2007, for a detailed review), firm level variables that are found to determine corporate leverage are firm size (due to reduced information asymmetries and increased collateral value), growth opportunities (as information asymmetry issues can be more severe in taking new projects for firms with more growth options), profitability (increases the ability to make timely interest payments) and tangibility (increases the collateral value). In this study, we follow the related literature and include these variables as controls. Importantly, in our regression specification, we take into account factors that affect cost of equity to attenuate the possible effects it can have on the relation between corporate leverage decisions in regard to credit market reforms. We also control for securities market reforms and reforms on capital flows from Abiad et al. (2010). These variables are constructed by including the development of securities markets and openness to foreign investors in the securities market reform index, and exchange rates, capital inflows and capital outflows in the index on capital transaction reforms. As all types of securities are considered while forming these two indices, we consider them separate than the banking sector reform measures that affect solely the banking sector. In addition to documenting lower corporate leverage following banking sector reforms, we further examine how corporate access to capital markets affects this relation. Specifically, we look at whether banking reforms led to a differential response in corporate leverage in financially constrained firms, in firms belonging to sectors that are more dependent on external finance, and in firms with access to global markets. For example, Schmukler and Vesperoni (2006) find asymmetric results on leverage of firms depending on their global access to capital. In this paper, we find that the negative association between banking reforms and corporate leverage is less pronounced for financially constrained firms, suggesting that these reforms improved allocation of resources for firms that have difficulty in accessing capital markets. Fan et al. (2012) show that institutional environment affects corporate leverage. Thus we control institutional features directly as well as in relation to the banking sector reforms. We do not find any significant effect of creditor information, creditor rights, lack of corruption and political risk on the relation between reforms and corporate debt. However, we find that firms employ more leverage in countries with better creditor rights. For example, Manthos 2012) finds that banking sector reforms are effective in reducing market power in countries with strong institutions. This finding suggests that institutional environment has a direct impact on capital structure decisions but it does not affect the relation between credit market reforms and corporate debt. Overall, by a detailed examination of domestic banking sector reforms on corporate leverage decisions in emerging markets, we find that corporate leverage is negatively associated with reforms that improve banking supervision and credit allocation, and that eliminate restrictions on interest rates. These findings are in line with the notion that reforms elicit more effective risk pricing by banks, which in turn increases the cost of funding, and as a result leads to lower debt levels in the corporate capital structure. These effects are less pronounced for financially constrained firms, suggesting that, for firms that were rationed out of the credit market before, reforms increase the availability of credit. The remainder of the paper is organized as follows. Section 2 provides a data overview including a discussion of the various credit market reforms tracked and lays out our empirical model. Section 3 illustrates the results, and Section 4 concludes.

In the last two decades, there have been a number of banking sector reforms in emerging markets along several dimensions: competition and new entry (including foreign banks) have been encouraged, measures to improve bank supervision and regulation have been undertaken, mandates on credit allocation reduced or lifted, many state-owned banks have been privatized, and controls on interest rates have been removed. In this paper, we examine how these banking sector reforms relate to corporate leverage in emerging markets, using a large cross-country panel of data and novel, time-varying measures of banking reforms. We find that corporations carry less (bank) debt in their capital structure following banking sector reforms, specifically reforms that improve banking supervision, credit allocation, and eliminate restrictions on interest rates. These findings suggest that these reforms advance banks' risk management and result in tightened lending standards, which in turn increase cost of bank funding or reduce its availability. As a result, firms on the average reduce debt in corporate capital structure. Importantly, however, we find that the negative relation of reforms with corporate leverage is significantly less pronounced for financially constrained firms, suggesting an improvement in credit allocation across firms, which benefits corporations that have more difficulty in raising capital.